Gold prices sink below $2,150 ahead of Fed meeting; copper rally cools

Gold prices slipped below the $2,150 mark in Asian trading on Monday, as investors shied away from non-yielding assets ahead of the Federal Reserve meeting later in the week, which is expected to provide further insight into interest rate policies.

Meanwhile, the rally in industrial metals, particularly copper, appeared to have slowed down after reaching 11-month highs last week. This pause in momentum came as Chinese economic data showed mixed results, prompting some profit-taking in the copper market.

The decline in precious metals was more pronounced, as the dollar stabilized near its two-week highs in anticipation of the Fed meeting. Additionally, with 10-year Treasury yields holding above 4%, investor interest in precious metals waned.

Spot gold dipped 0.4% to $2,148.19 per ounce, while gold futures for April delivery fell 0.5% to $2,151.05 per ounce

Investors are eagerly awaiting the outcome of the two-day Federal Reserve meeting scheduled to conclude on Wednesday. While it is widely anticipated that the central bank will maintain interest rates at their current levels, any hints of potential rate cuts will be closely scrutinized, especially given concerns about higher-than-expected inflation readings in February.

This cautious sentiment has pushed gold prices away from their record highs reached earlier in March, and a drop below the $2,150 support level could signal further losses in the short term. analysts suggested that gold prices might decline to as low as $2,100 per ounce in the near term. However, they also revised their end-2024 price target for gold to $2,300 per ounce, citing potential future interest rate cuts and deteriorating economic conditions as factors likely to support demand for gold throughout the year.

In addition to gold, other precious metals also retreated on Monday. Platinum futures dropped 0.7% to $935.50 per ounce, while silver futures slid 0.7% to $25.198 per ounce.